Companies can now apply for new licences to drill for offshore oil and gas in the North Sea.
Increasing recovery of UK oil and gas will enhance energy security, support thousands of jobs and provide billions in increased tax revenues. The UK oil and gas sector already supports around 350,000 jobs, and last year attracted a record £14 billion of capital expenditure as well as supplying around half of the UK’s primary energy demand.
UK Energy Minister Michael Fallon, MP, said: “There continues to be extremely high levels of interest in North Sea oil and gas, which is unsurprising when there could be as many as 20 billion barrels of oil still buried deep within the seabed. This new round of drilling for offshore oil and gas will help boost growth, energy security, and jobs in the UK.”
This latest licensing round supports the efforts of Government and industry’s joint Oil and Gas Industrial Strategy, which is working to secure future decades of investment and production in the North Sea.
Applications must be submitted by 25 April 2014.
Last year 36 offshore projects, with an associated capex of more than £9 billion, were approved, which provide tax revenues of £6.5 billion on production and a further £5 billion through the wider supply-chain in corporate and payroll taxes.
Meanwhile, North Sea oil and gas industry employment is spreading across the UK – as confirmed in the latest DECC statistics on regional employment;
* Scotland – 45%
- South East England – 21%
- North West England – 6%
- West Midlands – 5%
There are distinct clusters of high employment within the industry around the UK, with the Aberdeenshire area accounting for around 39% of the total employment. The other regions with sizable employment levels are East of England 5%, North West England 6%, and London and the South East 21%.
The sector offers highly skilled and qualified opportunities for young people and also for those looking to change career from other industries. Current forecasts for the next five years show there will be a requirement for an additional 15,000 employees.
Oonagh Werngren, Oil & Gas UK’s operations director, said: “Exploration in the North Sea has been challenged in recent years in both the number of exploration wells being drilled and their success rates.
“Only 15 wells were drilled in 2013 and less than 100 million boe were discovered in the last two years. Explorers cite access to rigs and equity capital as being the major contributing factors.
“We hope the 28th offshore oil and gas licensing round will encourage new applicants as well as established companies to explore the basin but industry needs to work collaboratively with HM Treasury and DECC in a tripartite arrangement as outlined by Sir Ian Wood’s recommendations from his Interim Report.”